Boosting financial innovations, Nexo and Mastercard, a global payments company, have partnered up to offer the world’s maiden crypto-backed payment card.
Nexo said users who will come to carry the crypto-backed payment card, currently available in select European countries, won’t have to sell their digital assets like bitcoin. These digital assets can be made use of in the form of security of return payment.
Two differences stand out when we compare this crypto card with traditional credit cards. These credit cards are secured. Plus, the limits on traditional credit cards are set, so you cannot spend more than you have. According to Nexo, the card allows investors to spend 90 percent of the fiat value of their crypto assets using a Nexo credit line, available using the crypto payment card.
A spokesperson from Nexo conveyed that there is an absence of repayment figures, monthly penalties, or foreign exchange fees in place. This is for purchases that amount to around 20,000 euros per month.
Customers can withdraw or spend as much as they like from the active line of credit using the crypto-backed card. Interest on the card comes to be charged upon the amount of credit actually used. Customers maintaining a ratio loan-to-value figure of either 20 percent or lower continue to receive 0% interest.
As Mastercard’s head of crypto and blockchain, Raj Dhamodharan, said, digital assets are revolutionising the financial landscape.